8 Trends in Financial Aid
US News & World Report ran an interesting article with eight financial aid trends for American colleges. The bad news is that college will cost more next year than ever before. But there is some good news, too. Here’s what US News had to say (and what I think about it).
1. It will be easier to apply for financial aid. I talked about the changes to the standard application for financial aid a few weeks ago. In short, the FAFSA has gotten shorter. The biggest recent changes? Eliminating redundant questions and spitting out an instant Estimated Family Contribution.
2. It will be easier to figure out just how much college will cost. A relatively new law means that colleges had to install web-based calculators on their websites that calculate true costs of attendance. Look for these tools on your school’s website.
3. It will get easier to receive tax breaks for education. I’ve told you before about ways to save money on college through education tax credits and deductions. The new American Opportunity Tax Credit can be applied to tuition paid, with refunds up to $1K.
4. It will be easier — and more lucrative — to get Federal grants. Remember all those posts this summer about the student loan and Pell grant reform? Well, the Pell Grant increased $200 (to $5,500) and the income cutoff is expected to go up as well.
5. It will get cheaper to attend college out of state. I’m including this, since it is on the US News‘ list, but frankly, I don’t see it as such a bonus. Basically colleges with relatively low rankings are going to be offering scholarships to attract out-of-state students. But I say: Why not focus your college search on better ranked, in-state colleges, where lower tuition means you may not even need scholarships?
6. It will be easier to get work-study jobs. Even if you don’t need a full-time job while in school, part-time gigs are great for paying things like those pesky bills for books and living expenses. The federal government is hip to this need, which is why they are increasing funding to allow for 200,000 more work-study jobs.
7. It will be easier and cheaper to take out student loans. As I’ve reported, changes to Stafford loans have seen interest rates drop (from 5.6 percent to 4.5 percent); the easing of credit markets means that there will be more options for private student loans than there were last year. My two cents on that: Be sure you investigate the terms of any loan closely, and especially a private one.
8. It will be more affordable to repay your student loans. Remember that Income Based Repayment Plan I was telling you about last spring? Well, if you are facing limited income and seemingly limitless loan payments, you might qualify for some loan modification.
Those are the trends as US News & World Report sees it (and as I see fit to comment on them!) But I want to know what you seeing out there on the ground? Are financial aid offices coming up with solutions for the growing needs of next year’s freshmen class? Are they working hard to keep hard working students in school, despite financial difficulties? Tell what you know!